In June 2021, a company largely known as a Hispanic-focused multimedia company with revenues fueled by strong digital growth, primarily across Spanish-speaking territories, began a revenue diversification effort that saw it acquire a Singapore-based online advertising and technology company.
Much has changed since then at Entravision Communications Corp., including the unexpected passing of its founder and CEO, and the substantial loss of revenue due to Meta’s July 1 wind down of its Authorized Sales Partner (ASP) program. Now, Entravision has agreed to sell its digital advertising representation business.
In a brief, two-sentence announcement made Friday by Santa Monica, Calif.-headquartered Entravision, the company today led by CEO Michael Christenson said it has entered into an agreement with Aleph Group that will see it part ways with its digital advertising representation units outside of the U.S.; its efforts in the U.S. Hispanic market are not impacted.
Entravision would only elaborate in the press release that the transaction has been approved by the Entravision Board of Directors and is expected to close within two weeks. However, a filing with the Securities and Exchange Commission by Entravision offers full details as to what the publicly traded company has signed off on.
On Thursday (6/13), an equity purchase agreement was signed by Entravision Digital Holdings, a Delaware LLC, and the buyer, Aleph’s IMS Internet Media Services Inc.
The transaction sees IMS acquire MediaDonuts and Redmas Ventures for $16.4 million. A $5 million deposit has been made to Entravision.
Terms call for Entravision to pay Xavier Torres, Managing Partner at Meta Latam at Entravision, $900,000 per the terms of an agreement between Redmas Ventures and Torres finalized on March 20, 2023.
Additionally, Entravision and IMS and the parties who sold MediaDonuts to Entravision on July 1, 2021, reached an agreement that will see, at closing, the assignment to IMS of an “earn-out agreement” between Entravision and its founders.
What does this mean? MediaDonuts’ founders are owed an amount in April 2025 based on a pre-determined multiple of EBITDA for each of calendar years 2023 and 2024. As such, Entravision will pay them $6.5 million.
It was on July 6, 2021 that Entravision, then under the leadership of Walter Ulloa, closed on its acquisition of MediaDonuts. The company serves a client base of technology and consumer brands in Thailand, Malaysia, Indonesia, India, Vietnam, Singapore and Cambodia. And, Entravision’s purchase of MediaDonuts came after it acquired a majority interest in Cisneros Interactive, seen in October 2020. In September 2021, Entravision purchased all outstanding shares of Cisneros Interactive, making it a wholly owned unit. Two months later, Entravision would acquire Cape Town, South Africa-headquartered 365 Digital, an investment the company at the time said provides it “with a geographic foothold in Africa, as the company looks to expand its breadth of digital services to new emerging markets.” Then, in May 2022, Entravision expanded to Kenya.
Things would rapidly evolve for Entravision, with its roots in Hispanic broadcast TV and radio but the majority of its revenue derived from its digital division, on New Year’s Eve 2022, when Ulloa would die of a heart attack. Christenson would join the company in 2023 as Chief Executive Officer.
Then came a March 5, 2024 revelation that a decision by the parent of Facebook, WhatsApp and Instagram that it will shutter its ASP program by July 1, and severely impact its revenue. For FY 2023, Entravision estimated Meta’s ASP program represents approximately 41.25% ($23.8 million) of its $57.7 million total consolidated EBITDA and $586.4 million of Entravision’s $1.107 billion of total consolidated revenue — 53%.
“While we are disappointed in Meta’s decision, we are confident in Entravision’s long-term opportunities given the strength of our advertising and marketing platforms and the need for our solutions globally,” Christenson said at the time. “We are conducting an extensive review of our strategy and cost structure to reinforce our operating foundation and ensure we are best positioned to capitalize on Entravision’s global, market-leading advertising, media and technology solutions. Our balance sheet is solid with a strong cash position to support the business as we navigate these changes.”
On May 10, Christopher Young was gone, with General Counsel Mark Boelke assuming his Treasurer/Chief Financial Officer role; Boelke signed off on the IMS transaction. Meanwhile, Juan Saldívar, Entravision’s Chief Digital, Strategy and Accountability Officer, officially exited Entravision after stepping down from the board in October 2023.
